Event
Company announcement:
1. TodayKangfang organismThe world's first tumor immunosuppressant Cadonilimab-PD-1/CTLA-4 double antibody (a new drug for the treatment of recurrent or metastatic cervical cancer) has been approved by CDE to submit a marketing application and priority evaluation, and Cadonilimab is expected to become the first PD-1-based specific double antibody to be approved for market.
2. The analysis of the data of phase II clinical trial of Cadonilimab shows that the drug is effective and safe in the treatment of recurrent or metastatic cervical cancer patients who failed to receive platinum-containing chemotherapy, and it is more effective than monoclonal antibody.
Comment
It has been recognized by FDA Orphan Medicine and is recognized both at home and abroad.
On February 23, 2021, Cadonilimab was certified by FDA as an orphan drug for the treatment of cervical cancer except for very early stage IA1. As early as 2020, the drug was approved by FDA and granted "Rapid approval Channel qualification (FTD)" for the treatment of recurrent or metastatic cervical cancer. On August 23rd, Kangfang Biological Cadonilimab was approved by CDE to submit the listing application and be given priority to evaluate the qualification. Kangfang Biological is expected to become the first company in China or even the world to be approved for this type of double resistance.
In the treatment of metastatic cervical cancer with recurrence or failure of first-line treatment, the choice of double anti-drug treatment at home and abroad is limited, and the clinical efficacy and safety of the newly launched Cadonilimab of Kang Fang Biology is also at a good level, with the early data ORR as high as 48%.
At present, there are few kinds of competitive products and the market potential is huge.
Cervical cancer is one of the most common gynecological tumors, although benefiting from the launch of the HPV vaccine in 2015, the incidence of cervical cancer is still the second highest in developing countries.
At present, only Merck's PD-L1/TGF- β is the tumor immunosuppressant double anti-drug approved by clinical tumor immunosuppressants for metastatic cervical cancer at home and abroad, which is currently in the stage of research. Earlier immunosuppressants for cervical cancer include bevacizumab, Shunitinib and sildenib, which inhibit tumor growth through anti-angiogenic targets.
In 2015, the GOC204 trial showed that the cure rate of cervical cancer increased when bevacizumab was added, but there is still no good solution for patients with recurrent cervical cancer after failed first-line treatment. According to Keynote028 and other key experiments, PD-1 inhibitors are effective in cervical cancer.
Rich drug pipeline, deep layout of tumor immunity and autoimmunity
In addition to the recurrent or metastatic cervical cancer NDA approved by CDE to submit the listing application and priority evaluation qualification, AK104 (Cadonilimab) also covers a number of indications with high incidence, such as gastric cancer, NSCLC, HCC, esophageal squamous cell carcinoma and so on. The clinical research is continuing and is in the clinical II stage. In addition, the company has a number of First-in-class-level double antibodies in the research.
Revenue forecast and valuation
We estimate that from 2021 to 2023, the company's revenue will be 665 million yuan, 2.107 billion yuan and 3.707 billion yuan respectively. Considering that the company has not yet made a profit and invested a lot in R & D, using DCF valuation, the reasonable market capitalization is HK $57.2 billion, corresponding to the target price of HK $70.0. Maintain the buy rating.
Risk factors
The progress of new drug development and evaluation is not up to expectations, clinical trials are not up to expectations, health insurance control fees and market competition risks.